Truck-as-a-Service (TaaS) Market

Market Overview

The global truck-as-a-service (TaaS) market size was valued at USD 28.32 billion in 2023. It is estimated to reach USD 183.13 billion by 2032, growing at a CAGR of 23.2% during the forecast period (2024–2032). In recent years, owing to the rapid proliferation of the internet, there has been a subsequent expansion of the e-commerce industry, which, coupled with a rise in urbanization, is estimated to increase the demand for fast and reliable transportation systems. This is estimated to augment the global market growth. Moreover, the truck-as-a-service (TaaS) market is driven by partnerships and collaborations among key players, who combine their resources, skills, and technology to develop more advanced and efficient TaaS solutions, thereby creating opportunities for market expansion.

Truck-as-a-Service (TaaS) is a business model that offers transportation solutions to businesses and individuals without requiring upfront investment in trucks or fleet management. Like Software-as-a-Service (SaaS), TaaS provides truck access on a subscription or pay-per-use basis, enabling users to utilize trucks as needed without the burden of ownership or maintenance costs. TaaS providers typically offer a range of services, including vehicle leasing, maintenance, insurance, and logistics management, tailored to the detailed needs of their clients. This model particularly appeals to businesses with fluctuating transportation demands or those seeking to optimize their logistics operations without the capital outlay associated with purchasing and managing a fleet of trucks. TaaS is poised to revolutionize the transportation industry by offering flexibility, cost-effectiveness, and scalability to businesses of all sizes.

Top 4 Key Highlights

• Light-duty trucks dominate the truck type segment
• Rental and leasing dominate the service type segment
• FMCG dominates the end-user segment
• North America is the highest shareholder in the global market

Market Dynamics

Market Drivers

Urbanization and E-commerce Growth

Urbanization and e-commerce growth drive the Truck-as-a-Service (TaaS) market by increasing demand for efficient last-mile delivery solutions. With the growth of cities and the rising popularity of online shopping, there is a heightened demand for reliable and efficient transportation services to ensure prompt delivery of products to customers. As per the United Nations, the worldwide urban population is projected to exceed 2.5 billion by 2050.

Also, according to Statista, with the rapid growth of global internet access and adoption, the number of people making purchases online is steadily rising, reaching over five billion internet users worldwide. By 2024, global retail e-commerce sales are projected to surpass 6.3 trillion U.S. dollars, with further growth anticipated in the following years. This is expected to increase the demand for TaaS providers, as it offers on-demand delivery options tailored to urban environments, meeting the evolving needs of e-commerce businesses and consumers for quick, convenient, and cost-effective logistics solutions in densely populated areas.

Market Restraint

Infrastructure Limitations

Infrastructure limitations pose a significant restraint on the Truck-as-a-Service (TaaS) market. The development of TaaS requires robust infrastructure, including charging stations for electric trucks, maintenance facilities, and digital infrastructure for communication and data exchange. However, this infrastructure is either insufficient or entirely lacking in many regions. Without adequate charging stations and maintenance facilities, the scalability and reliability of TaaS solutions are compromised.

Moreover, the absence of digital infrastructure hampers real-time communication and coordination between stakeholders, leading to inefficiencies and operational challenges. Addressing these infrastructure limitations requires substantial investment and collaboration between the public and private sectors to build the necessary physical and digital infrastructure. Until these infrastructure gaps are bridged, the growth and adoption of TaaS will be constrained, particularly in regions with inadequate support systems.

Market Opportunities

Collaborations and Partnerships 

The key market players are involved in collaborations and partnerships that play a pivotal role in propelling the Truck-as-a-Service (TaaS) market forward. By teaming up with technology firms for fleet management solutions, manufacturers for vehicle enhancements, and logistics companies for optimized routing, TaaS providers can offer comprehensive and efficient services. These collaborations enable TaaS providers to offer innovative solutions, expand their reach, and effectively meet the market's evolving needs.

For instance, in April 2023, Volta Trucks, a prominent and innovative manufacturer of all-electric commercial vehicles and provider of related services, partnered forces with NEoT Green Mobility to create financial solutions for customers. The goal is to give operating lease options to finance a maximum of 2,000 trucks starting in 2023. The money will empower Volta Trucks to provide customers with diverse financing options for the fully electric Volta Zero through the company's Truck as a Service (TaaS) service. Such collaborations are estimated to create opportunities for market growth.

Regional Analysis

Based on region, the global truck-as-a-service (TaaS) market is bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa. 

North America's truck-as-a-service (TaaS) market share is expected to expand substantially during the forecast period. North America represents a significant market for Truck-as-a-Service (TaaS) solutions, driven by the region's mature logistics and transportation industries and increasing adoption of innovative technologies. Government initiatives aimed at modernizing transportation infrastructure and promoting the adoption of electric vehicles further propel the growth of the TaaS market in the region.

For instance, implementing the Inflation Reduction Act (IRA) in the United States has led to a rise in manufacturing operations by global electromobility companies. Between August 2022 and March 2023, prominent electric vehicle (EV) and battery manufacturers announced a combined investment of USD 52 billion in North American EV supply chains, excluding the investments made by the Investment Retirement Account (IRA). Of this, 50% goes toward making batteries, 20% goes toward making battery components, and the remaining 20% goes toward making electric vehicles. This is expected to drive the growth of the regional market.

Furthermore, the development of new and innovative TaaS is estimated to create opportunities for market expansion. For instance, in March 2022, A new start-up, WattEV, located in Southern California, created a groundbreaking solution to address the difficulties shippers and carriers who wish to switch to battery-electric trucks face. WattEV's Truck-as-a-Service (TaaS) model offers the opportunity to use battery-electric trucks at a rate almost equal to diesel trucks, whether charged per mile or per route. This rate includes the vehicles and the costs of setting up and maintaining the charging infrastructure. This model, created and guided by industry professionals, can assist carriers in lowering the initial expenses of vehicle electrification by enabling the deployment of trucks as a service instead of as capital assets.

The Asia-Pacific region presents a dynamic and rapidly expanding market for Truck-as-a-Service (TaaS) solutions, driven by factors such as rapid urbanization, booming e-commerce, and evolving consumer preferences. Countries like China, India, Japan, and Southeast Asian nations are experiencing robust economic growth, leading to augmented demand for efficient transportation and logistics services. The region's congested urban centers and growing environmental concerns necessitate innovative solutions like TaaS to optimize fleet operations and reduce emissions. Moreover, as the e-commerce sector continues to flourish, there is a growing need for last-mile delivery solutions, further driving the demand for TaaS offerings. For instance, Statista predicts that the number of online shoppers will reach 427 million by 2027, driven by India's population of nearly 1.4 billion and its quickly growing economy. By 2030, the e-commerce industry is expected to surpass 350 billion U.S. dollars. This is anticipated to promote the growth of the Asia-Pacific market.

Segmental Analysis

The global truck-as-a-service (TaaS) market is bifurcated into truck type, service type, and end-user.

Based on truck type, the global truck-as-a-service (TaaS) market is segmented into light-duty trucks and heavy-duty trucks. 

The light-duty trucks segment dominated the global market. Light-duty trucks are vehicles designed for tasks such as transportation of goods, towing, or carrying passengers, but with a focus on efficiency and maneuverability. They typically have a lower payload capacity than heavy-duty trucks and are commonly used for personal and commercial purposes where heavy hauling isn't required. They are characterized by their versatility, offering various configurations such as extended cabs, crew cabs, and cargo beds of different sizes to accommodate diverse needs.

Light-duty trucks include pickup trucks, SUVs, vans, and crossover vehicles. Truck-as-a-Service (TaaS) revolutionizes the utilization of light-duty trucks by providing a flexible and cost-effective option to traditional ownership models. TaaS providers offer on-demand access to a fleet of light-duty trucks, allowing businesses to scale their operations according to fluctuating demand without the burden of ownership costs. This model enables businesses to optimize resource allocation, reduce idle time, and improve efficiency.

Based on service type, the global truck-as-a-service (TaaS) market is bifurcated into digital freight brokerage, telematics, truck platooning, and rental and leasing. 

The rental and leasing segment held the largest market share. Truck-as-a-Service (TaaS) has emerged as a transformative solution in truck rental and leasing services. With TaaS, businesses can access trucks through a flexible subscription-based model, eliminating the need for ownership and the associated maintenance costs. This innovative approach caters to the dynamic needs of businesses, allowing them to scale operations efficiently without the financial constraints of purchasing vehicles outright.

TaaS providers maintain a diverse fleet of trucks, offering on-demand rentals or long-term leasing arrangements tailored to individual requirements. Beyond mere access to vehicles, TaaS offers additional benefits such as access to the latest truck models, advanced fleet management tools, and customizable service packages. By embracing TaaS, businesses can enhance logistics, optimize resource allocation, and remain agile in today's ever-evolving transportation landscape.

Based on end-users, the global truck-as-a-service (TaaS) market is bifurcated into automotive and transportation, manufacturing, retail, FMCG, pharmaceutical and healthcare, chemicals, hi-tech industry products, food and beverages, and others. 

The FMCG segment is estimated to own the highest market share. Truck-as-a-Service (TaaS) plays a crucial role in the Fast-Moving Consumer Goods (FMCG) sector because it can optimize logistics and enhance supply chain efficiency. FMCG companies rely on the timely delivery of products to meet consumer demands and maintain competitiveness. TaaS offers flexible, on-demand access to transportation resources, allowing FMCG businesses to scale their operations according to fluctuating demand patterns without the burden of owning and managing a fleet of trucks.

By leveraging TaaS platforms, FMCG companies can reduce transportation costs, minimize idle time, and improve route optimization, leading to faster deliveries and better inventory management. TaaS also provides real-time tracking and monitoring capabilities, ensuring transparency and accountability over the supply chain. In a fast-paced industry like FMCG, where speed and reliability are paramount, TaaS offers the agility and efficiency necessary to stay ahead of the competition.

Recent Developments

• September 2023- Volta Trucks formed a new collaboration with Spryker, a prominent composable commerce platform for advanced business marketplaces. This project will be carried out in conjunction with Amazon Web Services. Volta Trucks aims to streamline truck ownership and facilitate the shift to an entirely electric fleet through their inventive Truck-as-a-service (TaaS) solution.
• October 2023- Societe Generale Equipment Finance (SGEF) and Volta Trucks announced information related to their collaboration to provide customers with customized integrated equipment finance solutions. The funding is being provided as part of the Truck as a Service (TaaS) offering.